Water Submetering: 5 Benefits for Multifamily Property Owners

Water submetering allows multifamily property owners to track water usage and bill back residents. Submeters require an upfront investment, but they are well worth the initial cost. Here’s why.

What Is Water Submetering?

Water submetering is a system where water usage for individual units in multi-unit properties—like apartments, condos or commercial buildings— is monitored and billed separately.

Instead of relying on one main master meter to track water usage for the entire property, each unit has its own submeter. This allows for precise water consumption tracking across all units.

This approach allows multifamily property owners to bill residents based on their actual usage. In turn, property owners are able to recover more utility costs rather than charging a flat fee for water utilities.

Utility rates fluctuate over time. When water utility rates rise or residents use more water, who pays for it?

Without submeters, property managers have to pay the difference between the higher bill and the flat fee they charge.

With submeters, your residents are responsible for their actual water usage each month. If usage increases or water rates rise, residents will see that cost reflected in their water bill.

5 Benefits of Submetering Water in Multifamily Properties

Benefit #1: Increased Water Conservation

When residents are billed for their water usage, they become more conscious of their consumption, which often leads them to use less water. This leads to reduced water usage across your entire multifamily property.

Decreasing water usage promotes sustainability and improves your property’s overall environmental footprint, which can be a valuable differentiator in an environmentally conscious market. On top of that, these improvements can help you leverage conservation programs.

Benefit #2: Lower Operational Costs & Better NOI

When your residents use less water, your property’s master water bill goes down. When your water bill goes down, your operational costs go down. When your operational costs go down, net operating income (NOI) goes up.

Water submeters are also a valuable perk in the eyes of prospective buyers should you decide to sell your property. A multifamily property with water submeters installed is attractive to buyers for the same reasons it’s attractive to you. When you flip the property, the increased NOI and property value will strengthen your position.

Benefit #3: Increased Cost Recovery Through Fair & Accurate Water Billing

Water usage can vary for a variety of reasons each month. If you’ve been covering water fees with rent or a flat rate, there will be times your collections fall well short of your total water bill. That means you need to make up the difference.

With submeters installed and tracking usage of each unit in your multifamily property, you can generate fair and accurate bills to bill back your residents for their actual water usage each month. This gets rid of a huge, variable expense for you and allows you to share it equitably with your residents.

When transitioning to a water billback program, the resident experience needs to be at the forefront of the mind. It’s important to ensure their water bill is fair and accurate, sent out at a predictable cadence, and payable using a variety of payment methods. If you work to make the resident billing experience as painless as possible, residents are more likely to pay on time, in full.

Benefit #4: Faster Leak Detection

Water submeters unlock a lot of useful data about your multifamily property. They allow you to monitor water usage in real-time, which allows you to spot water usage trends. If you start to notice a spike in usage, this could be an indication of leak.

Once you’ve spotted a potential leak, you can narrow down the location of the leak quickly because each unit has individual submeters installed. Simply determine the meter that is reading high and start your search there. Faster leak detection means you can mitigate water damage and save a lot of money on potential repairs.

Benefit #5: Increased Property Value & Long-term ROI

While the installation of your water submeters come with an up-front cost, that expenditure is usually recovered quickly. If you’ve been charging a flat fee for water utilities, you can typically recover the cost of your submeter installation through greater utility cost recovery in the first year of your system.

On top of that, submeters typically have a lifecycle of at least 10 years. That means your system will be providing added ROI for at least nine years.

Conclusion: Work with a Water Submetering Expert to Get Started

Water submetering offers multifamily property owners many benefits, but installing submeters and getting a utility billing system up and running can be a challenge without the right expertise. That’s why many property owners work with a utility billing company.

The right provider can help you design and build out your water submetering system. They can also manage your water utility billing program, from meter reading to bill generation to collection. This allows your team to focus on their core competencies while you reap the benefits of water submetering.

Want to learn more about water submetering in your property? Get in touch with Synergy Utility Billing. Our team can help you get started.